Immigrating to Hong Kong and following Hong Kong guides: Those who have been following the insurance market for years must have noticed that insurance premiums are rising alongside the cost of living. While some may joke that "insurance is only for the wealthy," relying solely on social security and savings is insufficient to cope with unexpected risks, making some form of commercial insurance necessary. Compared to mainland insurance, Hong Kong insurance offers various advantages. So, how can you purchase Hong Kong insurance in an economical and affordable way? Our editors have some tips for you.
1, Buy Insurance While You Are Young
For insurance products with long coverage periods that are paid annually or via a single premium, the younger the insured, the lower the premium. As age increases, risks related to accidents and health become more prominent, and obtaining high coverage naturally requires paying higher premiums. Therefore, it is always more cost-effective to purchase insurance early.
2, Shop Around
Premium rates vary among insurance companies, so it is essential to compare quotes from several providers before making a choice. However, it is crucial to select companies with strong capital and mature development to ensure reliable follow-up insurance services. Among them, Prudential, AXA, Manulife, and AIA have excellent credit and financial standing, which Hong Kong immigrants may consider when making their selection.
3, Term Insurance VS. Endowment Insurance
Insurance products can also be classified by payment type into term (consumption-based) and endowment (return-based) insurance. If the insured does not file a claim during the coverage period, the premiums for term insurance are not refunded upon contract expiration; whereas endowment insurance refunds premiums according to the agreed ratio (ratio > 100%). In other words, with term insurance, the money goes to the insurance company if no claim is made, while endowment insurance provides both the return of premiums and potential earnings.
In terms of returns alone, consumers undoubtedly prefer endowment insurance. However, in reality, for the same coverage amount, endowment premiums are significantly higher than term premiums, sometimes even 2-3 times higher. Given the development of our economic consumption levels, the returns on endowment insurance clearly cannot keep pace with inflation. Therefore, it is more suitable for consumers with strong financial strength who are not overly concerned about returns, while term insurance remains the preferred choice for cost-effectiveness.
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